Scandic Hotels (SHOT) Q2 2024 earnings summary

Executive summary

• Achieved strong Q2 results with net sales up 3.1% to SEK 5,871 million, driven by robust demand, improved efficiency, and higher prices across all markets, resulting in increased profitability and margins.

• Portfolio optimization continued with hotel exits, new signings, and expansion of the Scandic Go brand, including agreements in Gothenburg and Umeå.

• Secured long-term, sustainability-linked financing, enhancing financial flexibility and supporting growth ambitions.

• Reopened a large, renovated hotel in Stockholm and completed implementation of Oracle Hospitality Cloud across all hotels.

Financial highlights

• Q2 net sales increased by 3.1% to SEK 5,871 million (Q2 2023: SEK 5,693 million); adjusted EBITDA rose to SEK 841 million (772), with margin up to 14.3% (13.6%).

• Q2 operating profit was SEK 927 million (833); Q2 net profit was SEK 310 million (271); earnings per share Q2: 1.50 SEK (1.27).

• Free cash flow for Q2 was SEK 463 million (664); rolling twelve months at SEK 1.2 billion.

• Q2 RevPAR increased by 5.2% year-over-year to SEK 871; average room rate up 3.4% to SEK 1,360; occupancy at 64.0%.

Outlook and guidance

• Q3 bookings and occupancy rates are expected to be in line with last year, with higher average room rates and continued solid demand in the Nordics.

• Maintenance CapEx for the year expected at 3%-4% of net sales, likely closer to 4%.

• No further legacy timing effects expected to impact cash flow in 2024.

• Focus remains on cost control, efficiency, and portfolio growth.